Brief notes on National Planning Committee of India

Brief notes on National Planning Committee of India

There is no single definition which has been universally accepted. However, in a very loose sense, it is a technique, a means to an end, the end being the realization of certain pre-determined aims and objectives laid down by a central planning authority.

Michael, P. Todaro, in ‘Development Planning Models and Methods’ defined it, “as the conscious efforts of a central organisation to influence, direct and in some cases, even control changes in the principal economic variable of a certain country or region over the course of time in accordance with a pre-determined set of objectives.”

F. Zweig. “Planning is planning of the economy not within the economy. It is not a mere planning of towns, public works or separate section of the national economy but of the economy as a whole”.

In the earlier times, the nation was conscious about the significance of planned development. Prominent public men like Dadabhai Naraoji (1825-1917). M.G. Rande (1842-1901). R.C. Dutt (1848-1909) wrote extensively on the social and economic problems of the Indians.

In the year of 1934, Sir M. Visvesvarya, the renowned engineer and statesman formulated a ten years plan for economic development of the country in his book ‘Planned Economy for India’.

On the other hand, the Government of India Act 1935 introduced provincial autonomy which led to the formation of Congress Government in eight provinces.

In August 1937 the Congress Working Committee passed a resolution’ suggesting the committee of inter provincial experts to consider urgent and vital problems, the solution of which is necessary to any scheme of national reconstruction and social planning.

In October 1938, at a conference of Ministers of Industries held under the Chairmanship of Shri Subhash Chander Bose, the then President of the Indian National Congress, a resolution was passed which stated “the problems such as of poverty and unemployment, of national Defense and of economic regeneration in general cannot be solved without industrialization. As a step towards such industrialization, a comprehensive scheme of National Planning should be formulated.”

This was followed by the formulation of “National Planning Committee’ under the Chairmanship of Pandit Jawahar Lai Nehru. The committee consisted of 15 members.

In a memorandum, the committee emphasized that national independence is an indispensable preliminary for taking all the steps that might be found necessary for carrying out the plan in all its various aspects.

The Bombay Plan:

In the early 1944, some of the eminent industrialists and economists of Bombay (Sir Purshottamdas Thakurdas, Mr. J.R.D. Tata and six others) made another attempt which was called Bombay plan.

The total outlay of Rs 10,000 crores was recommended. The detailed allocation of funds were as follows-Industry and Power-Rs. 4480 crores, agriculture Rs. 1240 crores, Commerce Rs 940 crores, education and housing- Rs. 3340 crores.

Its sources of finances were-on external finance- Rs. 2600 crores (Including Rs. 1000 crores of sterling balances and foreign borrowing Rs.700 crores) and internal finance to the extent of Rs. 7,400 crores (consisting of saving Rs. 4,000 crores and created money of Rs. 3,400 crores).

The planners believed that this could be achieved only by reducing the over-whelming predominance of agriculture and by establishing a balanced economy.

This plan was the systematic scheme of economic planning which made the country plan-minded. Its major shortcoming was of maintenance of a capitalist order and giving step-motherly treatment to agriculture sector.

People’s Plan:

Another plan was prepared by the late M.N. Roy (a ten year plan) called the ‘People’s Plan’. It differed from the Bombay plan in methodology and priorities. Its chief emphasis was on agricultural and consumer goods industries through collectivization and setting up of state owned industrialization.

The total outlay was of Rs. 15,000 crores. It also advocated the nationalization of land. The plan was ambitious and it could not properly mobilize the resources. Therefore, it proved totally impracticable.

Gandhian Plan:

Gandhian Plan, which based upon Gandhian philosophy, was put forward by Shri S.N. Agarwal of Wardha. The outlay of the plan was estimated to be Rs. 3,500 crores only and it sought to set up a decentralized economy with self sufficient villages and Industrial production.

It laid emphasis on small scale industries and agriculture. But its scheme of financing was unsound. This plan was criticized as inconsistent and insufficient.

Before the Establishment of the Planning Commission

In 1944, the Govt, of India set up a Department of Planning and Development _for the purpose of preparing a plan for the economic re-construction of India in the post-war period.

The interring Govt was installed on 24th August 1946 and an Advisory Planning Board was set up in October 1946. In January 1950, late Shri. Jai Parkash Narayan presented Sarvodya Plan’ aiming at economic, political, social and normal development of the common masses.

In 1950, the Planning Commission was established under the chairmanship of Pt. Jawahar Lal Nehru. It was to assess the physical, capital and human resources of India and accordingly formulate a plan of economic development. After 15 months, the commission submitted, in July 1951, the Draft of First Five Year Plan. On 8th December, 1952, late Pt. Jawahar Lal Nehru presented the Final draft of the plan to the Lok Sabha.

Following table shows Public Sector Outlay under different five year plans since 1951.

Public Sector Outlay (In crore Rs.)

First Five Year Plan (1951-1956) Second Five Year Plan (1956-61) Third Five Year Plan (1961-66) Three One-Year Plans (1966-69)	1,960 4,672 8,577 6,625
Fourth Five Year Plan (1969-74)	15,779
Fifth Five Year Plan (1974-79)	39,426
Sixth Five Year Plan (1980-85)	1,09,292
Seventh Five Year Plan (1985-90)	2,21,436
Eighth Five Year Plan (1992-97)	4,74,121
Ninth Five Year Plan (1997-2002)	8,75,000